Case 12: The Movie Exhibition Industry: 2015 C-151theaters, is the largest with 7,367 screens in 574 domestic
theaters. Regal focuses on mid-size markets using mul-
tiplex and megaplexes that average nearly 13 screens
per location, with an average ticket price of $9.08.
AMC, operating under AMC and Loews chains, is the
second largest domestic exhibitor with 4,931 screens in
345 theaters. Averaging 14 screens per location, AMC
leads the industry in the operation of large multiplexes.
They do so by concentrating on urban areas near large
population centers such as those in California, Florida,
and Texas. By focusing on 3D, IMAX, and other pre-
mium viewing experiences, AMC has an average ticket
price of $9.43. Cinemark is the 3rd largest player with
4,499 screens in 335 domestic locations under Cinemark
and Century brands. Cinemark serves smaller markets,
operating as the sole theater in over 92 percent of its
markets. Their average ticket price is $7.02. Carmike
concentrates on small to midsized markets, targeting
populations of less than 100,000 that have few alter-
native entertainment options. They do so with fewer
screens at each location, averaging 106 per location
(274 theaters; 2,897 screens). Carmike’s ticket price
averaged $7.23. [Exhibit 12]
While ticket prices vary, differences in net profit
margins are due mostly to differences in utilization and
the costs of facilities, labor, and utilities. Despite con-
siderable size differences, the actual cost of content for
these circuits varies little among the majors circuits.
Regal’s exhibition costs as a percentage of revenue is
lowest at 52% of admission revenues, followed by AMC
(53%), Carmike (55%) and Cinemark (56%). While the
rentals costs for these circuits is similar, it is lower than
for smaller circuits.
The circuits ability to efficiently utilize their facil-
ities varies considerably. Cinemark’s average of 38,661
attendees per screen is nearly double Carmike’s 21,414
per screen. Revenues per screen for both Cinemark
($271,409) and Regal ($272,924) are nearly double that
of Carmike ($154,900). The differences in utilization
combined with differences in prices, concession sales per
person, and facilities, wages and other expenses results
in Cinemark having the highest operating income
per admission ($2.87), followed by Regal ($1.39), and
Carmike ($0.72).
Despite the trend toward internationalization by
studios, exhibitors until recently have been exclusively
domestic firms. Cinemark has the broadest international
presence with 153 theaters (1,344 screens) in Mexico and
seven Central and South American countries. In 2012,
AMC was acquired by the Chinese conglomerate Dalian
Wanda Group Corp for a reported $2.6 billion.^11 Wanda,
with interests in property, entertainment, and tourism
owns and operates 1,177 screens in 153 theaters in China.
Wanda/AMC is the largest global exhibition company
based on screen count with 6,575 screens and is expand-
ing rapidly in China.Exhibit 11 Exhibitor 2015 Advertising Revenue$678$50,458$–$100$200$300$400$500$600$700$800$0$10,000$20,000$30,000$40,000$50,000$60,0002002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013Advertising Revenue ($ mil.; right axis)
Advertising Revenue Per Screen (left axis)
Advertising Revenue Per 100,000 Admissions (left axis)Source: Cinema Advertising Council, 2014